ISLAMABAD: Oil prices surged on Wednesday following the production and export cuts announced earlier this week by the OPEC+ leaders – Saudi Arabia and Russia. As of 1345 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, gained $0.26 (+0.34 percent) to reach $76.51 a barrel. The West Texas Intermediate (WTI), the main oil benchmark for North America, went up by $1.88 (+2.69 percent) to $71.67 a barrel. Similarly, the price of Russian Sokol increased by $0.65 (+0.98 percent) to $66.69. Arab Light prices witnessed an increase of $0.63 (+0.81 percent) to reach $78.48 a barrel. However, the price for Opec Basket went down by $0.04 (-0.05 percent) to $74.34. The OPEC Reference Basket of Crudes (ORB) is made up of Saharan Blend, Girassol, Djeno, Zafiro, Rabi Light, Iran Heavy, Basra Light, Kuwait Export, Es Sider, Bonny Light, Arab Light, Murban and Merey. For the second month running, the leading OPEC producer, Saudi Arabia, has extended its voluntary 1 million bbl/day oil production cut for another month till August. The reduction will take the country’s production to around 9 million bbl/day, the lowest level in several years. Earlier this week, Russia announced it would further reduce its supply of oil. TLTP
“As part of the efforts to ensure a balanced market, Russia will voluntarily reduce its oil supply in August by 500,000 barrels per day by cutting its exports to global markets by that quantity,” Russia’s Deputy Prime Minister and top OPEC negotiator Alexander Novak said earlier this week.
The latest oil production and export cuts announced earlier this week by the OPEC+ leaders – Saudi Arabia and Russia –should be sufficient to bring the oil market back to balance, Suhail Al Mazrouei, the energy minister of the United Arab Emirates (UAE), said on Wednesday. “This is enough to assess the market and look at the market balance,” Al Mazrouei told reporters.
At the OPEC International Seminar in Vienna on Wednesday, Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman said that the OPEC+ alliance would do “whatever necessary” to support the oil market. The announcements from Saudi Arabia and Russia this week showed that cooperation between the two OPEC+ leaders continues to be strong, he added.
